As the retail sector suffers ever more and empty shops
on the high street become another pop-up project, we may at least take
some comfort from the crowdfunding phenomenon that is spreading like
wildfire.
From projects on art to Zulu history, it seems nothing
is taboo for this method of funding. Even ‘adult services' are now
offered via some crowdfunding platforms.
Are there any business models that are not appropriate
for crowdfunding? Not in my opinion. Now this doesn't mean automatic
success for the campaign or the project leaders. But with the four main
crowdfunding models now well established the concept is open for
business and incremental shifts in our socio-economic patterns are
beginning to emerge.
This isn’t a call for all start-ups to get online and
find the most appropriate platform, but it is a call for deeper
consideration of the model in any stage of a business.
Warnings have been issued by the Department for
Business, Innovation and Skills over the potential for funders in the
equity model to invest blindly in businesses that stood no chance of
success. But is this simply another instance of the government playing
catch-up with market trends and forces?
Across the pond these issues are coming to the fore
under the aptly named JOBS Act (Jump Start Our Business Start-ups),
where again the issues of risk are being cited as a reason to attempt to
limit the market on behalf of the consumer.
Our government shouldn't be given an easy time on this
issue. We are talking about a minority of people in the population who
would be willing to seek out and invest in these kinds of opportunities.
Even if these numbers increased significantly, each individual would
probably only be investing relatively small amounts.
Guidelines are certainly needed but guidelines are different from enforced restrictions.
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